Chapter 11: Set Up Payment and Postings
CHAPTER 11: SET UP PAYMENT AND POSTINGS Objectives The objectives are •
Introduce procedures for setting up payments in the Payroll module.
•
Introduce procedures for setting up electronic funds transfers in the Payroll module.
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Introduce the concepts and processes involved in posting payments, benefits, AP to GL.
Introduction This course introduces procedures that are used to set up payments and postings in the Payroll module.
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Microsoft Dynamics® AX Payroll s
Payment Set Up The Payment menu in the Setup area on the Payroll module area page contains the following payment selections for setting up payments: •
method
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type
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type group
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type benefit/deduction selections
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type earning selections
When you set up payments, there are also some additional features and parameters that you must set up: •
Statement message type
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Statement message
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Cancelled, Manual, and Regular payment parameters
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Check layout
This section provides procedures for all of these. The order the procedures are listed in is typically the order in which implementers perform them.
Procedure: Set Up a Statement Message Type Statement message types categorize the types of messages that can appear on pay statements. They are associated to payment types on the Payment types table. Payroll administrators can select one specific statement message when the regular pay processes. However, you can use statement message types to print more than one statement message for a pay period or a range of pay periods. Some examples are of statement message types are as follows: 1. 2. 3. 4. 5.
Company announcements Holiday messages Safety reminders Follow these steps to set up statement message types. In the Setup area in the Payroll area page, click Payroll, then Forms, and then click Statement message types. 6. Click the Overview tab, press CTRL+N to create a statement message code, and select the General tab. 7. In the Statement message type field, enter a code up to 20 characters that represents the statement message type.
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Chapter 11: Set Up Payment and Postings
8. Alter the Short code if you want. 9. In the Statement message type description field, enter a description up to 50 characters of the statement message type. 10. Verify that the Active date and Expiry date are correct for the statement message.
Procedure: Set Up a Statement Message Statement messages print on pay statements. Typical examples are seasonal messages or company announcements. When regular pay processes, payroll administrators can select one specific statement message to print on the statements. However, if more than one statement message is needed for a pay period or range of pay periods, then the payroll administrator can achieve this by using statement message types. The Statement message type form groups statement messages together, and the statement message type links to the Payment types table to determine when messages print. Follow these steps to set up a statement message type. 1. In the Setup area in the Payroll area page, click Payroll, then Forms, and then click Statement messages. 2. Click the Overview tab, press CTRL+N to create a statement message code, and select the General tab. 3. In the Statement message field, enter a code up to 20 characters that represents the statement message. 4. Alter the Short code if you want. 5. In the Statement message description field, enter a description up to 50 characters of the statement message. 6. In the Statement message type field, select the statement message type from the Statement message type table. 7. In the Statement type field, select Check or Direct deposit. 8. In the Message field, enter the message as it will appear on pay statements, up to 85 characters. 9. In the Statement sequence field, enter a number that dictates the order in which this message displays on employee pay statements. The lower the number, the sooner it displays. For example, a sequence 1 message displays before a sequence 2 message. 10. In the Start date and End date fields, enter the first day and last day that the message will appear on pay statements. 11. Verify that the Active date and Expiry date are correct for the statement message.
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Microsoft Dynamics® AX Payroll s Procedure: Set Up a Payment Type Payment types control the types of transactions, calculations, and deductions that the system can process when you create a payment. Some examples of payment types are as follows: •
Regular
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Replacement
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Advance
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Cancellation
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Supplemental
Follow these steps to set up payment types. 1. In the Setup area in the Payroll area page, click Payments, and then click Payment types. 2. Click the Overview tab, press CTRL+N to create a payment type code, and select the General tab. 3. In the Payment type field, enter a code up to 20 characters that represents the payment type. 4. Alter the Short code if you want. 5. In the Payment type description field, enter a description up to 50 characters of the payment type. 6. In the Maximum payments per period field, enter the maximum number of payments of this payment type that can be processed in one pay period. 7. In the Minimum payment amount and Maximum payment amount fields, enter the minimum and maximum payment amounts for this payment type. 8. Select Yes or No in the following fields: • Advance - Select Yes if this payment type can issue a pay advance.
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Chapter 11: Set Up Payment and Postings •
Supplements - Select Yes if this payment type is a supplemental type, which means that any benefit/deduction calculations will take the period's regular payment benefit/deductions into consideration and calculate only a top-up amount if appropriate. Regular payments are generated by the Payments generation process. The supplemental payment type uses the total gross pay for all regular payments in a pay period, adds the gross pay for the supplemental payment, recalculates all benefit/deductions, and calculates the difference to deduct for the supplemental payment. Also note that for supplemental pay types, if a regular payment has been generated in the pay period, and if a deduction is a fixed amount for each pay period and it has already been taken from the employee's regular payment, no more will be deducted. If the deduction is based on an accumulated amount or a percentage of earnings, and more earnings have been created for the employee, a further deduction will calculate only for the additional accumulated amount or for a percentage of the earnings.
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Cancellation - Select Yes if this payment type is used to reverse a specific payment. This payment type will reverse all benefit/deductions and advances for the payment it cancels, but it does not reverse the earnings, which you must reverse manually or adjust and pay on another payment.
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Benefit/deduction recovery - Select Yes if this payment type can recover benefit/deduction amounts owing if there is enough gross pay.
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Benefit - Select Yes if this payment type can calculate employer benefits.
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Negative net recovered - Select Yes if this payment type can recover negative net advances if there is enough gross pay.
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Negative net - Select Yes if this payment type can generate an advance if the net pay is negative.
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Prepaid benefit - Select Yes if this payment type can process prepaid benefit amounts.
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Employee deduction - Select Yes if this payment type can process employee deductions.
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Employer deduction - Select Yes if this payment type can process employer deductions.
9. Verify that the Active date and Expiry date are correct for the pay group ledger account. 10. Click the Payment type Supplement Selections tab and move the payment types that constitute a supplemental payment for this payment type, if any, to the Payment types selected list. Available payment types display in the Payment types remaining list.
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Microsoft Dynamics® AX Payroll s
11. Click the Payment type statement message types tab and move the statement message types that can be used with this payment type, if any, to the statement message types selected list. Available statement message types display in the statement message types remaining list. 12. If benefit/deductions and earnings have already been set up, you now can associate them with the payment type. Click on Setup and click on Payment type benefit/deduction selections.
Procedure: Set Up a Payment Type with Benefit/Deduction(s) You can set up payment types to associate with single or multiple benefit/deductions. Follow these steps to set up payment type with a single benefit/deduction selection. 1. In the Setup area in the Payroll area page, click Payments, and then click Payment type benefit/deduction selection. 2. Click the Overview tab, press CTRL+N to create a new benefit/deduction combination, and select the General tab. The selected payment type displays by default. 3. In the Active date field, enter the active date of the payment type and benefit/deduction combination in the format M/DD/YYYY, or if you want: • Type T to enter the machine date. •
Type D to enter the system date.
•
Select a date by using the calendar function.
4. In the benefit deduction or benefit deduction group fields, select the benefit deduction or benefit deduction group to associate with this payment type. Follow these steps to set up a payment type with multiple benefit/deduction selections. 1. In the Setup area in the Payroll area page, click Payments, and then click Payment type benefit/deduction selection. 2. Click the Overview tab, press CTRL+N to create a new benefit/deduction combination, and select the Fast Entry tab. 3. In the Payment types, Benefit deductions, and/or benefit deduction group fields, select the you want payment type code(s), select the benefit deductions and/or benefit deduction group codes to associate with the payment type(s), and then click Insert to create the combinations or Delete to cancel existing combinations.
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Chapter 11: Set Up Payment and Postings Procedure: Set Up a Payment Type with Earning Selection(s) You can set up payment types to associate with single or multiple earning selections. Follow these steps to set up a payment type with a single earning selection. 1. In the Setup area in the Payroll area page, click Payments, and then click Payment type earning selections. 2. Click the Overview tab, press CTRL+N to create a new payment type and earning combination, and select the General tab. The selected payment type displays by default. 3. In the Active date field, enter the active date of the payment type and earning combination in the format M/DD/YYYY, or if you want: • Type T to enter the machine date. •
Type D to enter the system date.
•
Select a date by using the calendar function.
4. In the earning or earning group fields, select the earning or earning group to associate with this payment type. 5. In the Active date field, enter the active date of the payment type and earning combination in the format M/DD/YYYY, or if you want: • Type T to enter the machine date. •
Type D to enter the system date.
•
Select a date by using the calendar function.
6. In the earning and/or earning group fields, select the earning and/or earning group to associate with this payment type. Follow these steps to set up a payment type with multiple earning selections. 1. In the Setup area in the Payroll area page, click Payments, and then click Payment type earning selections. 2. Click the Overview tab, press CTRL+N to create a new payment type and earning combination, and select the Fast Entry tab. 3. In the Payment types, Earnings, and/or earning group fields, select the you want payment type code(s), select the earnings and/or earnings group codes to associate with the payment type(s), and then click Insert to create the combinations or Delete to cancel existing combinations.
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Microsoft Dynamics® AX Payroll s Procedure: Set Up Cancelled, Manual and Regular Payment Parameters There are three payment type codes that you must identify on the Parameters table so the system can process payments correctly: •
Cancelled payments: payments to an employee that are reversed.
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Manual payments: payments to an employee that are issued outside the typical pay process.
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Regular payments: payments issued by the typical pay process.
Follow these steps to set up the necessary three payment parameters in the Parameters table. 1. In the Setup area in the Payroll area page, click Parameters. 2. In the Search tab, enter the General definition code "Cancelled payment type code", and click Search. 3. In the String value field, select the payment type to use as the default in the Cancel payments function. 4. Verify that the Active date and Expiry date are correct for the payment type. 5. Select the Search tab, enter the General definition code "Manual payment type code", and click Search. 6. In the String value field, select the payment type code to use as the default in the Manual payments function. 7. Verify that the Active date and Expiry date are correct for the payment type. 8. Select the Search tab, enter the General definition code "Regular payment type code", and click Search. 9. In the String value field, select the payment type code to use as the default in the Payments generation function. 10. Verify that the Active date and Expiry date are correct for the payment type.
Procedure: Set Up a Payment Type Group Payment type groups can be used to group payment types for user-defined reports. Payment type groups are not currently used in any of the standard system reports. Follow these steps to set up payment type groups: 1. In the Setup area in the Payroll area page, click Payments, and then click Payment type groups. 2. Press CTRL+N to create a new payment type group, and select the General tab.
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Chapter 11: Set Up Payment and Postings 3. In the Payment type group field, enter a code up to 20 characters that represents the payment type group. 4. Alter the Short code if you want. 5. In the Payment type group description field, enter a description up to 50 characters of the payment type group. 6. Verify that the Active date and Expiry date are correct for the payment type group. 7. Click the Payment type group types tab and add the payment types for the payment type group by adding them to the Payment types selected list. Available payment types are displayed in the Payment types remaining list. If necessary, see the "Set Up a Payment Type" procedure to create a new payment type.
Procedure: Set Up Payment Method Payment methods identify how employees are paid and identify the appropriate report and bank export information for the payment method. Examples of payment methods are as follows: •
Check
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Direct deposit
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Pay card
Follow these steps to set up a payment method. 1. In the Setup area in the Payroll area page, click Payments, and then click Payment methods. 2. Press CTRL+N to create a new payment method, and select the General tab. 3. In the Payment method field, enter a code up to 20 characters that represents the payment type group. 4. Alter the Short code if you want. 5. In the Payment method description field, enter a description up to 50 characters of the payment method. 6. In the Statement type field, select the statement type for the payment method (Check or Direct deposit). 7. In the Company bank account field, select the bank account to use for the payment method, from the Banks module. 8. Verify that the Active date and Expiry date are correct for the payment method.
Procedure: Set Up a Check Layout Check layouts define how check and direct deposit information is arranged on pay statements and checks. You can create an unlimited number of check and direct deposit layout definitions.
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Microsoft Dynamics® AX Payroll s NOTE: You must define at least one check layout for each statement type. Follow these steps to set up a check layout. 1. In the Setup area in the Payroll area page, click Payroll, then Forms, and then click Check layout. 2. Press CTRL+N to create a new check layout. 3. Select the appropriate Check form type for this layout definition. Check form types are delivered with the system. 4. In the Statement type field, select Check or Direct Deposit. Select the General tab. 5. In the Check position field, select Top or Bottom for the position for the negotiable check on the check form. 6. In the Check start position field, enter the starting position for the check, which is used with the Unit for the start position of the check value to align the check information correctly on the form. 7. In the Unit for the start position of the check field, select the starting position unit for the check: • Mm: number of millimeters from the page border •
Cm: number of centimeters from the page border
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Pt: number of points from the page border
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Char: number of characters from the page border
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Inch: number of inches from the page border
8. In the Check stub start position field, enter the starting position for the check stub, which is used with the Unit for the start position of the check value to align the check information correctly on the form. 9. In the Unit for the start position of the check stub field, select the starting position unit for the check stub: • Mm: number of millimeters from the page border •
Cm: number of centimeters from the page border
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Pt: number of points from the page border
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Char: number of characters from the page border
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Inch: number of inches from the page border
10. In the Prefix field, enter the currency character(s) that will appear in front of the check amount. 11. In the Check date format, select the format for the date that will print on the check: • Formatted: prints the date in September 23 2008 format •
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YYYYMMDD prints the date in 20080923 format
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Chapter 11: Set Up Payment and Postings •
DDMMYYYY prints the date in 23092008 format
•
MMDDYYYY prints the date in 09232008 forma
12. Select the Setup tab and check any of the boxes to display the following information on the check: • Bank name •
Bank address
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Bank telephone
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Company name
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Company address
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Company telephone
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Company logo
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Employee address (will only print if the Display option in the Employee addresses table is set to Yes)
13. Select the Statement print sort order: • Report distribution/Name sorts by the report distribution code on the employee's position and then alphabetically by name •
Name sorts alphabetically by employee name
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Employee ID sorts by employee ID numbers and/or characters
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Report distribution/Employee ID sorts by the report distribution code on the employee's position and then by employee ID
14. Select the Stub tab, then: • In the Sections to be shown column, select the sections you would like show on the stub. •
In the Lines to display column, enter the number of each type of field to print on the check form.
•
In the Force long listings column, check the appropriate boxes to print the full description for each type of field on the check form.
15. Select the Signature tab. Check the Print first signature, Print second signature, and/or Print third signature boxes to indicate how many signatures are required on checks. In the First amount limit, Second amount limit, and/or Third amount limit fields, enter the net pay limit that the signatory has authority to sign for. 16. Click the Print test button to print a test page with the check layout specifications. 17. Click the Company logo button to insert a logo image to print on the check form.
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Microsoft Dynamics® AX Payroll s 18. Click the Bank signature button to add signature images to print on the check form. 19. Click the Payroll check designer button to design the form.
Electronic Funds Transfers In the Payroll module, the primary location for setting up electronic funds transfers is the Financial institutions menu in the Setup area, on the Payroll module area page. This menu contains these selections: •
Account types
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Financial institutions
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Financial institution export formats
For each financial institution, you also can set up the following: •
Addresses
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Electronic contacts
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Notes
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Persons
In addition, for each financial institution contact person, you can set up specific: •
Addresses
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Electronic contacts
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Name
•
Notes
If the organization uses direct deposit for employee pay, then you must set up the account type codes used for employee savings and checking accounts on the Parameters table. Before these parameters can be set, however, you first must set up the account types. The order in which the procedures in this section are listed is typically the order in which implementers will use them.
Procedure: Set Up a Financial Code A financial institution code is used for employees who are paid by direct deposit. Create an entry in this table for each different bank branch that your employees use for direct deposits. The code should be meaningful because the bank number and transit number do not display when you associate a bank to an employee.
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Chapter 11: Set Up Payment and Postings Follow these steps to set up a financial institution code. 1. In the Setup area in the Payroll area page, click Financial institutions, and then click Financial institutions. 2. Click the Overview tab, then press CTRL+N to create a new financial institution code. Select the General tab. 3. In the Financial institution field, enter a code up to 20 characters that represents the financial institution branch. 4. Alter the Short code if you want. 5. In the Financial institution description field, enter a description up to 50 characters of the financial institution code. 6. In the Bank number field, enter the primary identifier of the financial institution. 7. In the Transit number field, enter the secondary identifier of the financial institution. 8. Verify that the Active date and Expiry date are correct for the financial institution code. 9. You now can set up Addresses, Electronic Contacts, Notes, and Persons for the financial institution code.
Procedure: Set Up a Financial Institution Address Financial institution addresses are used for reporting purposes. Follow these steps to set up a financial institution address. 1. In the Setup area in the Payroll area page, click Financial institutions. When the Financial institutions form opens, click the Setup button and select Addresses. 2. Click the Overview tab, and press CTRL+N to create a new address code. Select the General tab. 3. In the Address type field, select an address type from the list. 4. In the Street name field, enter the complete street address. 5. In the ZIP/Postal code field, enter the postal or ZIP code for this address. 6. In the City field, select the city code for this address. 7. In the Country/region field, select the country/region for this address, if any. 8. In the Display field, select Yes or No to determine if the address will print on reports. 9. In the Display priority field, enter a number to dictate the order in which this address displays on reports. The lower the number, the higher the priority. For example, a priority 1 address will display before a priority 2 address.
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Microsoft Dynamics® AX Payroll s 10. Verify that in the Financial institution address field, the address information you entered above displays. 11. Verify that the Active date and Expiry date are correct for the address.
Procedure: Set Up an Electronic Contact You can maintain financial institution electronic contact information in the Payroll module. This information includes: •
Telephone number and extension
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Email address
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Web address
Follow these steps to set up electronic contact information. 1. In the Setup area in the Payroll area page, click Financial institutions. When the Financial institutions form opens, click the Setup button and select the Overview tab. Select the financial institution, and click the Setup button. Select Electronic contacts. 2. Press CTRL+N to create a new electronic contact, and select the General tab. 3. In the Contact type field, select a contact type from the list. 4. In the Telephone area code field, enter a telephone area code, if applicable, up to 10 characters. 5. In the Telephone number and Telephone extension fields, enter the telephone number and extension of the contact, if applicable, up to 50 characters. 6. In the Email address field, enter the email address of the contact, up to 80 characters. 7. In the Display field, select Yes or No to indicate whether the address will print on reports. 8. In the Display priority field, enter a number to dictate the order this address displays on reports. The lower the number, the higher the priority. For example, a priority 1 electronic contact will display before a priority 2 electronic contact. 9. Verify that the Active date and Expiry date are correct for the electronic contact.
Procedure: Set Up a Financial Institution Person You can associate a person with a financial institution. Use financial institution persons to record who your organization deals with at a particular financial institution. Examples include:
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•
Business accounts manager
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Bank manager
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Chapter 11: Set Up Payment and Postings You must associate financial institution persons with a person group and person type. You can use them for reporting purposes. NOTE: For each financial institution person, you can set up their address, electronic contact, name, and notes. An example of when you may choose to do this is when a financial institution contact person's address is different, or more detailed, than the financial institution's address. To set up this information specifically for a financial institution person, click the Setup button in the Financial institution person form, then use the procedures provided in this section for setting up financial institution addresses, electronic contacts, names, and notes. Follow these steps to set up a financial institution person. 1. In the Setup area in the Payroll area page, click Financial institutions. When the Financial institutions form opens, click the Setup button and select the Overview tab. Select the financial institution, and click the Setup button. Select Persons. 2. Press CTRL+N to create a new financial institution contact person and select the General tab. 3. In the Person group field, select a person group from the list. 4. In the Person type field, select a person type from the list. 5. Click on Setup, select Name, and press CTRL+N to create a new name entry for the financial institution person. Select the General tab. 6. In the Professional prefix field, enter a prefix for the person if appropriate. 7. In the Salutation field select a salutation from the list if appropriate. 8. In the First, Middle, and Last name fields, enter the person's names up to 50 characters each. 9. In the Suffix field, select a suffix from the list if appropriate. 10. In the Professional suffix field, enter a professional suffix if appropriate. 11. Select a Name sequence from the list that dictates the order of the person's first, middle, and last names. 12. The Search name field displays the person's first name. Change the name used to search for the person if appropriate. 13. If you want, enter nickname information up to 50 characters in the optional Nickname fields. 14. Alter the entries in the Full name (150 characters) and Display name (50 characters) fields, if you want. Both fields display the Last name and First name information by default.
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Microsoft Dynamics® AX Payroll s 15. Verify that the Active date and Expiry date are correct for the person name information, then close the window. 16. After creating the person name, click the Setup button and select Addresses, and then click CTRL+N to create a new address for the financial institution person. 17. Enter the address information for the financial institution person, verify that the Active date and Expiry date are correct for the person address information, and close the window. 18. Click the Setup button and select Electronic Contacts, then press CTRL+N to create a new electronic contact for the financial institution person. 19. Enter the electronic contact information for the Financial Institution person, the verify that the Active date and Expiry date are correct for the person electronic contact information.
Procedure: Set Up a Financial Institution Note Use financial institution notes to store information such as hours of business or general remarks for reporting purposes. Follow these steps to set up a financial institution note. 1. Click on Payroll, then click Setup, then click Financial institutions, and then click Financial institutions. 2. Select the Overview tab, select the financial institution code, then click the Setup button, and select Notes. 3. Press CTRL+N to create a new note, and select the General tab. 4. In the Note type field, select a contact type from the list. 5. In the Note subject field, enter a subject for the note up to 255 characters. 6. In the Note text field, enter the text of the note. There is no character limit. 7. Verify that the Active date and Expiry date are correct for the note.
Procedure: Set Up an Account Type You can use account types for financial institutions to identify different types of accounts used for direct deposits. Account types can be used for reporting purposes and you must use them if you are entering account information for employees. Examples include:
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•
Checking
•
Savings
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Chapter 11: Set Up Payment and Postings Follow these steps to set up an account type. 1. In the Setup area in the Payroll area page, click Financial institutions, then click Account types. 2. Click the Overview tab, and press CTRL+N to create an account type. Select the General tab. 3. In the Account type field, enter a code up to 20 characters that represents the account type. 4. Alter the Short code if you want. 5. In the Account type description field, enter a description up to 50 characters of the financial institution code. 6. Verify that the Active date and Expiry date are correct for the account type.
Procedure: Set Up the Employee Checking Account and Savings Account Code Parameters If the organization uses direct deposit for employee pay, then you must set up the account type codes used for employee savings and checking accounts on the Parameters table. Before these parameters can be set, you first must set up the account types. These parameters are used to produce electronic deposit files, with the appropriate bank account information, for each employee deposit. Follow these steps to set up employee checking account and savings account code parameters. 1. In the Setup area in the Payroll area page, click Parameters. 2. In the Search tab, enter the General definition code "Employee checking account type", and click Search. 3. In the String value field, select the account type representing an employee's checking account for direct deposit. 4. Verify that the Active date and Expiry date are correct for the account type. 5. Select the Search tab, enter the General definition code "Employee savings account type", and click Search. 6. In the String value field, select the account type representing an employee's savings account for direct deposit. 7. Verify that the Active date and Expiry date are correct for the account type.
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Microsoft Dynamics® AX Payroll s Procedure: Change a Financial Institution Export Format Location Export files are used to export information to a financial institution for direct deposits. To change the local location where a financial institution export file will be created, you must change the export file location. Follow these steps to change the export file location. 1. In the Setup area in the Payroll area page, click Financial institutions, then click Financial institution export formats. 2. Click the Overview tab, select the required financial institution export format code, then select the General tab. 3. In the Export file location field, enter the location where the export file will be created, or browse to it by using the folder button. 4. Save the change.
Set Up Transaction Postings When the Payments posting, Benefits Posting, and AP Invoice Posting features are used, transaction information posts to GL accounts from related Payroll accounts. This section describes: •
Which Payroll module accounts are selected when transactions post to GL accounts - and where to set them up.
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The priority system used by the Payroll module to select dimension values during the posting process.
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How the Payroll module determines offset accounts during the posting process.
Setting Up Postings You can make three types of postings. •
Payments
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Benefits
•
AP Invoice
In each instance, transaction information posts to GL accounts from related Payroll accounts. This section provides tables that show where to set up the Payroll accounts from which transactions will post to each GL account.
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Chapter 11: Set Up Payment and Postings Payments Posting When you click Payroll> Payroll Area > Periodic > Pay Period > Payments posting, the following types of transactions post: •
Earnings
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Employee-paid benefit/deduction amounts
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Negative nets
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Advances
•
Net Pay
A table explains each of these payments postings.
Earnings DR
CR
DR
CR
GL Account
Amount
Date
Account selected on:
Expense Account
Labor expense
Posting date*
1 - Payroll > Setup > Earnings > Earning account exceptions The debit ledger account. Or, if no exception applies: 2 - Payroll > Setup > Earnings > Earnings. The Earning debit accounting ledger account selected for the earning.
Payroll Clearing
Payroll liability
Posting date*
1 - Payroll > Setup > Earnings > Earning account exceptions The credit ledger account. Or, if no exception applies: 2 - Payroll > Setup > Earnings > Earnings. The Earning credit accounting ledger account selected for the earning. Or, if no ledger account is selected: 3 - Payroll > Setup > Payroll > Pay group ledger accounts. The Payroll clearing account selected for the Pay group.
* If "GL postings to be summarized" parameter is true, then the Posting date is the Pay period end date; otherwise, the Posting date is the Earning date.
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Microsoft Dynamics® AX Payroll s Deduction/Benefits – EMPLOYEE DR
CR
DR
CR
GL Account
Amount
Date
Account selected on:
Payroll Clearing
Employee (EE) amount of benefit/ deduction
Pay Period end
Payroll > Setup > Payroll > Pay group ledger accounts. The Payroll clearing account selected for the Pay group.
Benefit/ deduction Liability
Employee (EE) amount of benefit/ deduction
Pay Period end
Payroll > Setup > Payroll > Pay group ledger accounts. The Employee deduction liability account selected for the Pay group.
GL Account
Amount
Date
Account selected on:
Negative net receivable
Negative net incurred amount
Pay Period end
Payroll > Setup > Payroll > Pay group ledger accounts. The Negative net receivable account selected for the Pay group.
Payroll Clearing
Negative net incurred amount
Pay Period end
Payroll > Setup > Payroll > Pay group ledger accounts. The Payroll clearing account selected for the Pay group.
Payroll Clearing
Negative net recovery amount
Pay Period end
Payroll > Setup > Payroll > Pay group ledger accounts. The Payroll clearing account selected for the Pay group.
Negative net receivable
Negative net recovery amount
Pay Period end
Payroll > Setup > Payroll > Pay group ledger accounts. The Negative net receivable account selected for the Pay group.
Negative Nets DR
CR
DR
CR
DR
CR
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Chapter 11: Set Up Payment and Postings Advances DR
CR
DR
CR
DR
CR
GL Account
Amount
Date
Account selected on:
Advance receivable
Advance payment amount
Pay Period end
Payroll > Setup > Payroll > Pay group ledger accounts. The Advance receivable account selected for the Pay group.
Payroll Clearing
Advance payment amount
Pay Period end
Payroll > Setup > Payroll > Pay group ledger accounts. The Payroll clearing account selected for the Pay group.
Payroll Clearing
Advance recovery amount
Pay Period end
Payroll > Setup > Payroll > Pay group ledger accounts. The Payroll clearing account selected for the Pay group.
Advance receivable
Advance recovery amount
Pay Period end
Payroll > Setup > Payroll > Pay group ledger accounts. The Advance receivable liability account selected for the Pay group.
Net Pay DR
CR
DR
CR
GL Account
Amount
Date
Account selected on:
Payroll Clearing
Net pay amount
Statement date
Payroll > Setup > Payroll > Pay group ledger accounts. The Payroll clearing account selected for the Pay group.
Cash/Bank
Net pay amount
Statement date
The ledger account selected in the Bank module (Bank > Bank accounts) for the bank selected in Payroll's Check clearing account parameter and Direct deposit clearing account parameter (Payroll > Setup > Parameters).
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Microsoft Dynamics® AX Payroll s Benefits Posting When you click Payroll > Payroll Area > Periodic > Pay Period > Benefits posting, transactions post to the following accounts:
Deduction/Benefits – EMPLOYER DR
CR
DR
CR
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GL Account
Amount
Date
Account selected on:
Unit benefit/ deduction expense
Employer (ER) amount of benefit/ deduction
Pay Period end
1 - Payroll > Setup > Benefit/deductions > Benefit/deduction account exceptions The Employer debit ledger account. Or, if no exception applies: 2 - Payroll > Setup > Benefit/deductions > Benefit/deductions. The Employer debit accounting ledger account selected for the benefit/deduction.
Benefit/ deduction Liability
Employer (ER) amount of benefit/ deduction
Pay Period end
1 - Payroll > Setup > Benefit/deductions > Benefit/deduction account exceptions The Employer credit ledger account. Or, if no exception applies: 2 - Payroll > Setup > Benefit/deductions > Benefit/deductions. The Employer credit accounting ledger account selected for the benefit/deduction. Or, if no ledger account is selected: 3 - Payroll > Setup > Payroll > Pay group ledger accounts. The Employer deduction liability account selected for the Pay group.
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Chapter 11: Set Up Payment and Postings AP Invoice Posting When you click Payroll > Payroll Area > Periodic > Pay Period > AP invoice posting, transactions post to the following accounts:
Benefit/Deduction Payment through AP DR
CR
GL Account
Amount
Date
Account selected on:
DR
Benefit/ deduction Liability
Employee (EE) amount of benefit/ deduction
Pay Period end
Payroll > Setup > Payroll > Pay group ledger accounts. The Employee deduction liability account selected for the Pay group.
DR
Benefit/ deduction Liability
Employer (ER) amount of benefit/ deduction
Pay Period end
Payroll > Setup > Payroll > Pay group ledger accounts. The Employer deduction liability account selected for the Pay group.
Accounts Payable Control
All benefit/ deduction amounts
Pay Period end
1 - Payroll > Employee > Setup > Benefit/deductions. The Employee AP Vendor and Employer AP vendor selected for the employee's benefit/deduction. Or, if none was selected for the employee: 2 - Payroll > Setup > Benefit/deductions > Benefit/deductions. The Employee AP Vendor and Employer AP vendor selected for the benefit/deduction.
CR
Dimension Selection The Payroll module selects dimensions for the earnings and benefit/deductions associated with the transactions it posts to GL. It selects the dimensions to use by looking for this data in a series of locations, and using the first data it finds.
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Microsoft Dynamics® AX Payroll s
The following tables show these locations in the order they are looked at by Payroll, and also show the navigation path used to enter or modify the dimension data.
DIMENSION SELECTION FOR EARNINGS
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Location and Order of Priority (1 is highest)
Navigation Path for Data Entry/Modification
1. Earning account exception
Payroll > Payroll Area Page > Setup > Earnings > Earning account exceptions Used only if you want the same earning code to generate different dimension values based on: • Employee's department organization •
Employee's occupation
•
Earning's task
•
Earning's work reason
•
Earning's relief reason
2. Earning
Payroll > Payroll Area Page > Setup > Earnings > Earnings
3. Job's department split
Payroll > Places > Employees > Setup > Jobs > Setup > Department splits to select a department organization. Payroll then uses any dimension values set for that department organization (Payroll > Organization levels).
4. Job's department
Payroll > Places > Employees > Setup > Jobs to select a department organization. Payroll then uses any dimension values set for that department organization (Payroll > Organization levels).
5. Employee's department split
Payroll > Places > Employees > Setup > Department splits to select a department organization. Payroll then uses any dimension values set for that department organization (Payroll > Organization levels).
6. Employee's department
Payroll > Places > Employees to select a department organization. Payroll then uses any dimension values set for that department organization (Payroll > Organization levels).
7. Pay group ledger account
Payroll > Payroll Area > Setup > Payroll > Pay group ledger accounts. For each pay group, select dimension values for the Payroll clearing account
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Chapter 11: Set Up Payment and Postings DIMENSION SELECTION FOR BENEFIT/DEDUCTIONS Location and Order of Priority (1 is highest)
Navigation Path for Data Entry/Modification
1.Benefit/deduction account exception
Payroll > Payroll Area Page > Setup > Benefit/deductions > Benefit/deduction account exceptions Used only if you want the same benefit/deduction code to generate different dimension values based on: • Employee's department organization •
Employee's occupation
•
Earning's task*
•
Earning's work reason*
•
Earning's relief reason*
* If the payment is based on earnings that have the task, work reason and/or relief reason specified, then Payroll determines what fraction of all earnings that the earnings with the specified task, work reason and relief reason is. It then calculates a similar fraction of the selected benefit/deduction amount and posts it to the selected account. 2. Benefit/deduction
Payroll > Payroll Area Page > Setup > Benefit/deductions > Benefit/deductions
3. Job's department split
Payroll > Places > Employees > Setup > Jobs > Setup > Department splits to select a department organization. Payroll then uses any dimension values set for that department organization (Payroll > Organization levels).
4. Job's department
Payroll > Places > Employees > Setup > Jobs to select a department organization. Payroll then uses any dimension values set for that department organization (Payroll > Organization levels).
5. Employee's department split
Payroll > Places > Employees > Setup > Department splits to select a department organization. Payroll then uses any dimension values set for that department organization (Payroll > Organization levels).
6. Employee's department
Payroll > Places > Employees to select a department organization. Payroll then uses any dimension values set for that department organization (Payroll > Organization levels).
7. Pay group ledger account
Payroll > Payroll Area Page > Setup > Payroll > Pay group ledger accounts For each pay group, select: • Employer deduction liability account •
Employee deduction liability account
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Microsoft Dynamics® AX Payroll s Determining Offset Accounts This section describes how the Payroll module determines offset accounts. Three general cases are described: •
Global Offset Accounts
•
Earning Offset Accounts
•
Benefit/deduction Offset Accounts
Global Offset Accounts The Payroll module determines the global offset accounts for a pay group by going to the Pay group ledger accounts table (Payroll > Payroll Area > Setup > Payroll > Pay group ledger accounts). For each pay group, you select accounts for Payroll clearing, Employer deduction liability, Employee deduction liability, Advance receivable, and Negative net receivable.
Earning Offset Accounts The offset account information for an earning consists of a ledger account and dimension codes and is optional in the Earnings table. Users can set up earning debit accounts and earning credit accounts. The Payment posting function confirms whether the earning being processed has an offset account set up. If it does, the system uses the earning's accounting credit information instead of the pay group's clearing account information. If no offset account is found, the system uses the pay group's clearing account information. If dimension codes are not present on the earning record, Payments posting uses the department organization to look up the Organization levels table to determine if dimension codes are defined there. If they are, the system uses these dimension codes for the earning record being processed. If any accounting exceptions on the Earning Account Exceptions table exist for the earning, the system goes through the exceptions in the following sequence until it locates dimension codes for the combination. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11.
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Earning Code + Department + Occupation + Project + Work + Relief Earning Code + Department + Occupation + Project + Work Earning Code + Department + Occupation + Project + Relief Earning Code + Department + Occupation + Project Earning Code + Department + Occupation + Work + Relief Earning Code + Department + Occupation + Work Earning Code + Department + Occupation + Relief Earning Code + Department + Occupation Earning Code + Occupation + Project + Work + Relief Earning Code + Occupation + Project + Work Earning Code + Occupation + Project + Relief
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Chapter 11: Set Up Payment and Postings 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24.
Earning Code + Occupation + Project Earning Code + Occupation + Work + Relief Earning Code + Occupation + Work Earning Code + Occupation + Relief Earning Code + Occupation Earning Code + Department + Project + Work + Relief Earning Code + Department + Project + Work Earning Code + Department + Project + Relief Earning Code + Department + Project Earning Code + Department + Work + Relief Earning Code + Department + Work Earning Code + Department + Relief Earning Code + Department
Benefit/deduction offset accounts The benefit/deductions global offset account information comes from the Pay group ledger accounts table (Payroll, Setup, Payroll ) deduction liability account types. The offset account information for a benefit/deduction consists of a ledger account and dimension codes and is optional in the Benefit/deductions table. Users can set up employer debit, credit, and AP vendor accounts, and employee debit, credit, and AP vendor accounts. The Payment posting function first checks to see if the deduction being processed has an employee debit set up. If it does, the system uses that account instead of the pay group's clearing account information on the Pay group ledger accounts table. If it does not the system uses the pay group's clearing account information. The posting process also verifies whether the deduction being processed has an Employee credit account set up. If it does, it uses that instead of the Pay group's Employee deduction liability account on the Pay group ledger accounts table. If it does not, the system uses the Pay group's Employee deduction liability account. The Benefits Posting function verifies whether the deduction being processed has an Employer debit account set up. If it does, the system uses that account instead of the earning record's department(s) information. If it does not, the system uses the earning record's department(s) information. The Posting process also verifies whether the deduction being processed has an Employer credit account set up and uses that instead of the Pay group ledger account table's Employer deduction liability account. If it does not, the system uses the Pay group's Employer deduction liability account. The AP Posting function also uses the deduction's employer/employee debit accounts instead of the employer/employee deduction liability information from the Pay group ledger account table. If that has not been set up, the system uses the Pay group's employer/employee deduction liability information.
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Microsoft Dynamics® AX Payroll s If there are any accounting exceptions on the Benefit/deduction account exceptions table for the benefit/deduction, the system goes through the exceptions in the following sequence until dimension codes are located for the combination. 1. Ben/Ded Code + Department + Occupation + Project + Work + Relief 2. Ben/Ded Code + Department + Occupation + Project + Work 3. Ben/Ded Code + Department + Occupation + Project + Relief 4. Ben/Ded Code + Department + Occupation + Project 5. Ben/Ded Code + Department + Occupation + Work + Relief 6. Ben/Ded Code + Department + Occupation + Work 7. Ben/Ded Code + Department + Occupation + Relief 8. Ben/Ded Code + Department + Occupation 9. Ben/Ded Code + Occupation + Project + Work + Relief 10. Ben/Ded Code + Occupation + Project + Work 11. Ben/Ded Code + Occupation + Project + Relief 12. Ben/Ded Code + Occupation + Project 13. Ben/Ded Code + Occupation + Work + Relief 14. Ben/Ded Code + Occupation + Work 15. Ben/Ded Code + Occupation + Relief 16. Ben/Ded Code + Occupation 17. Ben/Ded Code + Department + Project + Work + Relief 18. Ben/Ded Code + Department + Project + Work 19. Ben/Ded Code + Department + Project + Relief 20. Ben/Ded Code + Department + Project 21. Ben/Ded Code + Department + Work + Relief 22. Ben/Ded Code + Department + Work 23. Ben/Ded Code + Department + Relief 24. Ben/Ded Code + Department
Summary Setting up payments and postings in the Payroll module involves using procedures for:
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•
Setting up payment types, methods, groups, statements, and associated features and parameters.
•
Setting up financial institution codes, account types, export formats, and associated contact information and parameters.
•
Setting up which Payroll module accounts are selected when transactions post to GL, and where to set them up.
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Chapter 11: Set Up Payment and Postings
Test Your Knowledge 1. Which of the following statements is true about statement message types? (Select all that apply) ( ) Statement message types categorize the types of messages that can appear on pay statements. ( ) A statement type is associated with a pay group in the Payment types table. ( ) Statement message types are associated to payment types on the Payment types table. ( ) One example of a statement message type could be safety reminders. 2. Check layouts define how check and direct deposit information is arranged on pay statements and checks. You can create an unlimited number of check and direct deposit layout definitions, however: ( ) Statement message types categorize the types of check layouts. ( ) At least one statement type must be defined for each check layout. ( ) At least one check layout must be defined for each statement type. ( ) There are some cases where no check and direct deposit layout definitions need to exist. 3. Which of the following statements about setting up financial institution codes is not correct? ( ) Implementers create financial institution codes for each different bank branch that employees use for direct deposits. ( ) The financial institution code should be meaningful, because the bank and transit numbers do not display when a bank is identified for an employee. ( ) Financial institution codes are only used for employees in the same pay group. ( ) A financial institution code is used for employees who are paid by direct deposit.
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Microsoft Dynamics速 AX Payroll s
4. Explain when and where you must set up account type parameters for employee savings and checking accounts. Also, state anything else you must do before you can set up these parameters.
5. What are the three types of postings that can be made: ( ) Payments ( ) AP Invoice ( ) Benefits ( ) Earnings
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Chapter 11: Set Up Payment and Postings
Quick Interaction: Lessons Learned Take a moment and write down three key points you have learned from this chapter 1.
2.
3.
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Microsoft Dynamics® AX Payroll s
Solutions Test Your Knowledge 1. Which of the following statements is true about statement message types? (Select all that apply) (√) Statement message types categorize the types of messages that can appear on pay statements. ( ) A statement type is associated with a pay group in the Payment types table. (√) Statement message types are associated to payment types on the Payment types table. (√) One example of a statement message type could be safety reminders. 2. Check layouts define how check and direct deposit information is arranged on pay statements and checks. You can create an unlimited number of check and direct deposit layout definitions, however: ( ) Statement message types categorize the types of check layouts. ( ) At least one statement type must be defined for each check layout. (•) At least one check layout must be defined for each statement type. ( ) There are some cases where no check and direct deposit layout definitions need to exist. 3. Which of the following statements about setting up financial institution codes is not correct? ( ) Implementers create financial institution codes for each different bank branch that employees use for direct deposits. ( ) The financial institution code should be meaningful, because the bank and transit numbers do not display when a bank is identified for an employee. (•) Financial institution codes are only used for employees in the same pay group. ( ) A financial institution code is used for employees who are paid by direct deposit.
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Chapter 11: Set Up Payment and Postings
4. Explain when and where you must set up account type parameters for employee savings and checking accounts. Also, state anything else you must do before you can set up these parameters. MODEL ANSWER: If the organization uses direct deposit for employee pay, then the account type codes used for employee savings and checking accounts must be set up on the Parameters table. Before these parameters can be set, the account types must first be set up. These parameters are used to produce electronic deposit files, with the appropriate bank account information, for each employee deposit. 5. What are the three types of postings that can be made: (√) Payments (√) AP Invoice (√) Benefits ( ) Earnings
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Microsoft Dynamics速 AX Payroll s
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